The Great Crises – Security Implications of Disruption of Africa’s Commodity Market by Nanotechnology

Nanotechnology, the science of minuscule molecule, is advancing with potentials that can radically alter the structures of modern commerce, industry and culture. It promises to disrupt global markets and transform industries through low cost, high efficiency and large capacity tools, processes and products.

A transformative technology with ability to evolve a new industrial revolution offers many national opportunities and threats. Nations with capabilities to create or adopt and consequently diffuse the technology applications will amass wealth. These are innovators with knowledge-driven economies. Other nations, usually poor, lack inventive abilities with economies anchored on minerals extraction and agriculture.

With lack of knowledge creative skills, they derive most of their export earnings from commodities, undifferentiated and widely price-based traded raw materials and agricultural products. Ninety-five of the 141 developing countries derive at least 50 percent of their export earnings from commodities. In most sub-Sahara African nations, non-fuel commodities account for more than 65% of their foreign earnings.

The United Nations Conference on Trade and Development (UNCTAD) estimates that a third of global population, about two billion people, is employed in commodity production.

For most commodity-dependent countries, scientific innovation and adoption capabilities are lacking. In other words, the poor state of their science and technology skills may hinder them to utilize the advancements from nanotechnology to improve production efficiency, offer higher valued products, engineer processes that require modest labor, capital, energy, land and materials.

Having consistently failed in effectively adopting new technologies, from steam engines to microelectronics, with perennial low scores on major development, technology and innovation indices, nanotechnology adoption will not be any easier for developing economies. If nothing else, the quantum mechanical nanotechnology will be more difficult to acquire than many that came before it that depended mainly on the classical Newtonian physics with far lesser skills and infrastructure requirements.

Potential success in the downstream sector of nanotechnology, marketing and distribution, cannot come without skilled manpower that understand the technology and can contribute at the creative upstream stage. At least in the short-term, many least developed nations may not take potential technological benefits of nanotechnology to advance commodities and differentiate them in international market.

Notwithstanding the problems in the developing nations, advanced economies will continue to pursue innovation on nanotechnology. There are possibilities that new nanomaterials will become good alternatives for many existing commodities (eg, rubber, copper, cotton, platinum, etc) and incrementally, the commodity markets and industries could be disrupted, or even demised.

The implication is massive trade and unemployment dislocations that could pose serious security implications in commodity-dependent nations. If nanotechnology delivers efficient means of making affordable, durable and quality energy sources like batteries, nations that depend on export of fuel commodities like crude oil will suffer devastating economic impacts. A nation like Nigeria that earns more than 85% of its foreign earnings from crude oil could see riots and banditries across its cities from displaced workers.

As nanotechnology disrupts the global market structures and displaces commodities, sub-Sahara Africa could witness major crises fueled by job losses and reduced incomes. Lack of capability to transition to new industries or markets will make these crises prolonged with effects that will affect their political and economic stabilities. The world will potentially see clusters of nano-conflicts across African cities and villages when mining and extraction offer little economic values, unless Africa develops a knowledge strategy and transforms itself to a knowledge-power.